Dimon Warns of ‘Unsettling’ Pressures as JPMorgan Reports Earnings

Jamie Dimon, the chief executive of JPMorgan Chase, on Friday warned of an “unsettling” global landscape, highlighting a cascade of pressures including war, rising geopolitical tensions and inflation that threaten the economy and could weigh on the performance of the nation’s largest bank.

Mr. Dimon’s remarks, made concurrently with his bank’s quarterly earnings report — which showed weakness in some parts of the business — add to his litany of concerns about the U.S. economy as the Federal Reserve grapples with when or whether to lower interest rates, particularly in light of this week’s hotter-than-expected inflation data.

On a call with reporters on Friday, Mr. Dimon underlined his angst, describing heady financial markets as “too happy.” He said he couldn’t predict whether the economy would enter a recession, but that “the chance of bad outcomes is higher than people think.”

Mr. Dimon is the most prominent bank leader, and his pronouncements are closely followed on Wall Street and in Washington. He was the only head of a major American lender to attend this week’s White House state dinner for Japan’s prime minister.

His gloom, however, has also been consistently at odds with strong financial markets. In late 2022, for instance, he predicted economic bumps and, potentially, a severe recession for the next year; instead, the American economy boomed in 2023.

JPMorgan’s financial performance was affected by more ordinary issues. The bank reported more than $13 billion of profit in the first quarter and nearly $42 billion in revenue, both better than expected. But its average customer deposits fell, and it warned of higher expenses in the future. JPMorgan also disclosed a fall in its so-called net interest income, a closely watched financial metric that essentially measures how much money it is able to make from lending.

Wells Fargo, the nation’s third-largest bank, on Friday separately reported earnings that also included a drop in that measure. Shares of both banks were lower in early trading before the market opened Friday.

Many economists predicted that this year would bring a so-called soft landing, or a gentle easing in growth and inflation that would allow the Federal Reserve to lower interest rates in an orderly fashion.

Now, with little indication of any slowdown, it is unclear whether the central bank will make the three interest rate cuts that officials had predicted for the year. Mr. Dimon has been among the few to say they are preparing for the possibility that interest rates will be raised again, a move that would suggest more extreme inflation than is currently being measured.

Mr. Dimon made more extended remarks on the tricky environment in his annual letter to shareholders this week. He lamented, as he had before, that the United States engaged in deficit spending and ticked off a list of complaints about where public and private leaders have fallen short. (“Social media could do more,” he wrote.) Referring to Russia’s invasion of Ukraine and other crises, he wrote that recent events “may very well be creating risks that could eclipse anything since World War II.”

On Friday, he said that the topic on top of his mind was “the future of the free world.”